Friday
Jan112019

Two New Milliman White Papers On MSSP Pathways to Success: 

Final Rule Revisions and Data Mining Tactics to Reduce Population Costs

By  Clive Riddle, January 11, 2019

Milliman's Noah Champagne, Charlie Mills, and Jason Karcher published a white paper on January 7th: “Pathways to Success” MSSP final rule: Key revisions to the proposed rule, which was preceded with a paper on January 4th by Kathryn V. Fitch, Adam Laurin, and Michele M. Berrios: “Pathways to Success” MSSP final rule: Faster movement to downside risk increases focus on reducing population costs.

The final rule isn’t a radical departure from the proposed rule, but as Champagne, Mills and Karcher summarize, these are the key changes from the proposed rule:

  • Levels A and B maximum shared savings percentage increased from 25% to 40% while Levels C and D increased from 30% and 40%, respectively, to 50%.
  • Less strict definition of low-revenue ACO: Now ACOs are considered “low revenue" if their historical Medicare Part A and B fee-for-service (FFS) revenues are less than 35% of the total historical expenditures for their assigned Medicare beneficiaries. 
  • High-revenue ACOs currently participating in MSSP Track 1+ will be allowed an exception to renew for one agreement period in Level E of the BASIC track.
  • New, low-revenue ACOs, not experienced with performance-based Medicare ACO initiatives, will be allowed to remain in Level B (one-sided risk) for an additional performance year. 
  • The final rule retains the proposed 3% cap on benchmark increases for risk scores. However, ACOs’ benchmarks will be fully adjusted for changes in the relative risk score when there is a decrease from the baseline year to the performance year instead of applying a 3% reduction cap as originally proposed.
  • The final rule still uses a maximum regional cost blending percentage of 50%, but finalizes a more gradual phase-in of the maximum blending percentage from the proposed rule for ACOs with historical expenditures above their regional service areas.
  • ACOs participating in the July to December 2019 performance period and selecting prospective assignment will be assigned beneficiaries based on October 2017 to September 2018 experience data.

Champagne, Mills and Karcher conclude that “CMS introduced the MSSP with the goal of transitioning ACOs to becoming risk-bearing entities and improving the quality of care provided to Medicare FFS beneficiaries. With the MSSP final rule, CMS has reaffirmed its commitment to these goals while offering greater shared savings potential to ACOs participating in the BASIC track and making the BASIC track available to a broader set of ACOs. The effect of these rule changes on specific ACOs will vary significantly depending on an ACO’s size, region, cost and quality performance, and structure.”

 

Fitch, Laurin and Berrios remind us that “one of the hallmarks of the new MSSP rule is faster movement to downside risk. Under the current regulations, accountable care organizations (ACOs) can stay in an upside-only track for up to six years. The new rule requires some ACOs in the Basic Track to begin assuming some downside risk in year 3.”  They stat that “under the new rule, there will be a more urgent need for ACOs to reduce population costs,” and that “two major tactics are typically implemented by health plans and ACOs to reduce population costs” are demand management and supply management.

 

Their report “focuses on supply management and, in particular, data mining tactics that identify medically unnecessary services.” They advocate "several data mining tactics we have seen successful ACOs adopt to effectively guide strategies to reduce medically unnecessary services and in turn reduce the ACO’s total population costs." including:

  • "For MSSP participants, the monthly Claim and Claim Line Feed (CCLF) data files provided by CMS should be routinely grouped and summarized into an actuarial cost model in order to evaluate cost drivers, identify potential targets for utilization reduction initiatives, track outcomes expected from key initiatives, and track overall costs compared to the ACO’s PMPY expenditure benchmark set by CMS."
  • "After identifying potential services to target from the actuarial cost model, organizations need to evaluate whether the utilization and spend in a service category represents efficient or inefficient care with very little or very large opportunity for improvement."
  • "ACOs must be able to target inefficient physician performance, which requires credible provider profiling. As with the benchmarking exercise described previously, physician profiling requires credible risk adjustment."
  • "ACO should also consider data mining to identify leakage of services to providers outside of the ACO." 
Friday
Jan112019

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week: 

Federal Shutdown Mostly Spares Health Coverage, But Other Issues Loom

As the partial government shutdown drags on, about 800,000 federal employees who work for the shuttered agencies — and their families — are facing the reality of life without a paycheck.

Kaiser Health News

Friday, January 11, 2019

As Congress returns, lawmakers rush to detail drug-pricing agendas

Chuck Grassley wasted little time this week in unveiling his drug-pricing agenda, attaching his name to a trio of bills that, as the new chair of the Senate Finance Committee, he is freshly empowered to advance.

Stat News

Thursday, January 10, 2019

Medicaid ‘Buy-In’ Could Be a New Health Care Option for the Uninsured

Even as calls for “Medicare for All” grow louder among Democrats in Washington, D.C., at least 10 states are exploring whether to allow residents to pay premiums to “buy in” to Medicaid, the federal-state health care program for the poor.

Pew Trust

Thursday, January 10, 2019

Health Care Industry Spends $30B A Year Pushing Its Wares, From Drugs To Stem Cell Treatment

Hoping to earn its share of the $3.5 trillion health care market, the medical industry is pouring more money than ever into advertising its products — from high-priced prescriptions to do-it-yourself genetic tests and unapproved stem cell treatments.

Kaiser Health News

Tuesday, January 8, 2019

At glitzy Vegas tech show, chronic-disease gadgets to take center stage

An exploding array of digital health companies will converge on Las Vegas this week to showcase the latest advances in using data and algorithms to try to solve the world’s toughest health problems.

Stat News

Monday, January 7, 2019 

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

Friday
Jan042019

A Tour of 2019 Healthcare Predictions

By Clive Riddle, January 4, 2019 

We recently released our own 2019 healthcare prognostications, and now it’s time to take a tour of a selected healthcare weather forecasts for the year ahead, on a variety of fronts. 

First for a general overview, we stop at the PwC Health Research Institute’s 13th annual report on the year ahead, with six healthcare trends to watch in 2019

  1. Connected health devices and digital therapies will become integrated into care delivery and the regulatory process for drug and device approvals, with several new products coming to market
  2. Healthcare organizations will have to make major capital and training investments in artificial intelligence robotics, automation and data analytics in order to keep pace.
  3. The 2017 Tax Cuts and Jobs Act will continue to create tax savings for healthcare organizations while creating new challenges. 
  4. The healthcare industry is ready for a disruptor like Southwest, the budget airline provider was to that industry. 
  5. The pace of healthcare private equity investment will accelerate 
  6. Republican changes to the ACA will shift the law's winners and losers. Providers are on the losing end of most of these changes.

Also, providing an overall view is CareMore’s Sachin H. Jain in Forbes magazine with these: 10 Healthcare Industry Predictions for 2019:

  1. Humanism and humanity in healthcare will make a real comeback.
  2. The epidemic of loneliness will take center stage.
  3. Medicare Advantage will be seen as a template for the healthcare system of the future
  4. Quality measurement will focus on what happens in the exam room.
  5. The health care industry will make progress on new models for drug pricing.
  6. We will finally learn what Amazon, Berkshire Hathaway and JP Morgan are up to.
  7. Tech companies will get into the health care delivery business.
  8. More buzzwords: I’m not sure what language mashups we can expect next year, but rest assured they’ll generate plenty of conferences and spam emails.
  9. Another unlikely, head-scratching mega-merger will occur.
  10. We will all keep our new year’s resolutions: Each of us will lose fifteen pounds. We will all read a book a week. We’ll learn Mandarin, remember to call our grandparents, wash the dog more often and write that mystery novel about the doctor who uncovers a crime syndicate operating out of the hospital cafeteria 

One more overview entry on the tour comes from the 2019 HCEG Top 10 by the Healthcare Executive Group 

  1. Data & Analytics: Leveraging data (especially clinical) to manage health and drive individual, provider and payer decisions.
  2. Total Consumer Health: Improving members’ overall medical, social, financial, and environmental well-being.
  3. Population Health Services: Operationalizing community-based health strategy, chronic care management, driving clinical integration, and addressing barriers to health such as social determinants.
  4. Value-based Payments: Transitioning to and targeting specific medical conditions to manage cost and improve quality of care.
  5. The Digital Healthcare Organization: HSAs, portals, patient literacy, cost transparency, digital payments, CRM, wearables and other patient-generated data, health monitoring, and omni-channel access/distribution.
  6. Rising Pharmacy Costs: Implementing strategies to address growth of pharma costs along with benefits to quality of care and to total healthcare costs.
  7. External Market Disruption: New players like Amazon, Chase, Apple, Walmart, and Google.
  8. Operational Effectiveness: Implementing lean quality programs, process efficiency (with new core business models), robotics automation, revenue cycle management, real-time/near-time point of sales transactions, etc.
  9. Opioid Management: Developing strategies for identifying and supporting individuals and populations struggling with substance abuse/addiction or at risk of addiction.
  10. Cybersecurity: Protecting the privacy and security of consumer information to maintain consumer trust in sharing data 

Here’s a venture capital perspective on the healthcare industry from Venrock, featured in Fortune magazine: 10 Health Care Predictions for 2019 From a Pair of Venture Gurus 

  1. More payer consolidation
  2. Physician-led Accountable Care Organizations will grow rapidly
  3. Doctors get less dissatisfied
  4. Interoperability becomes interoperable: Five years after being declared successful, forces will finally come together to lead breakthroughs on cross health system and platform interoperability. 
  5. Consolidation in digital health
  6. We think that we are near peak hype cycle for insurance technology. 2019 is likely to be a year of toe stubbing for many. 
  7. Dialysis disrupted: Just as Sears has been replaced by home delivery, dialysis centers will be supplanted too. 
  8. Telemedicine takes off
  9. PBM disruption talk becomes reality
  10. Real progress with new DNA sequencing platforms 

Turning toward technology, CIO Magazine offers Healthcare technology markets: 5 predictions for 2019: 

  1. Health systems are investing in specific programs such as telehealth and remote monitoring. While these initiatives gather momentum, other digital health programs are struggling to emerge from pilot deployment and also face competing priorities for discretionary budgets.
  2. AI will make steady progress but will struggle with adoption gaps
  3. Big tech is yet to figure out its play for healthcare markets, with one possible exception (Apple Watch)
  4. Digital health startups will face a continuing struggle for growth and stability
  5. Blockchain will remain a solution looking for a problem 

On the policy front, Morning Consult offer thse Top 5 Health Policy Predictions for 2019

As cost of health care continues rising, states and industry set to act 

  1. Affordable Care Act: A ruling from a federal judge finding the Affordable Care Act unconstitutional has cast uncertainty on the future of the nation’s health care system — and reframed national debate on health reform ahead of the 2020 elections.
  2. CMS waiver guidance: Armed with a majority, House Democrats are poised to probe how the Trump administration has handled the ACA during the last two years
  3. Drug-pricing policy: Addressing the cost of prescription drugs is sure to continue dominating health priorities in 2019, although there is a long road from bipartisan commitment to reducing prices — to bipartisan consensus on how best to do so.
  4. Shift toward value-based payment structures: Increasing pressure on hospitals, which contributed to one-third of total health care spending last year, could drive a shift toward value-based payment models next year — a top priority in the Department of Health and Human Services’ Choice and Competition 2018 report.
  5. Digital therapeutics and e-health: After years of being just within reach, digital therapeutics and e-health initiatives stand to finally emerge in in the industry and transform care delivery next year. 

Next, we’ll consider employer benefit trends, with the selections of Mercer thought leader predictions posted here and here: 

  1. AI everywhere!  Healthcare will be the next industry to be transformed by AI. 
  2. Account-based plans create buzz.  
  3. Personalization of health care. 
  4. Value on investment: The new yardstick for benefits will be how they affect employees’ perception of their employer. 
  5. Transparency in Rx pricing.  
  6. Getting family-friendly fast. 
  7. Extreme claims get real.   A number of factors are driving an increase in both the prevalence and the size of extreme claims
  8. More stop loss. With the severity and frequency of catastrophic claims, employers will up their stop loss insurance levels and those that don’t buy it now will reconsider. 
  9. More outsourcing.  HR and health and wellbeing functions will increasingly be outsourced t
  10. Midsized employers doing something really different.  While jumbo employers are typically the trailblazers, this year midsized employers will take the lead with a couple of truly radical benefit strategies:
  11. Moderate cost growth allows longer-term focus. 
  12. Big things for behavioral health Change is happening in the behavioral health care delivery system.
  13. Specialty drugs will command attention. 
  14. Rx management gets yet more complicated. PBMs, carriers, pharma companies, and wholesalers will continue to face intense scrutiny regarding profits, delivery models and alignment (or lack of alignment) with plan sponsor goals.
  15. Employers mix it up with clinical services. 
  16. The issue of bill coding will surface. As doctors and hospitals become health systems, they are hiring coding experts at an increasingly rapid rate as a means of maximizing reimbursements. 

Finally, let’s end the tour peeking into pharmaceuticals, as CFO magazine features Deloitte’s Greg Reh in Four Trends That Could Shape Life Sciences in 2019 

  1. Greater scrutiny over drug pricing. 2018 was one of the biggest years for policy efforts to reduce drug prices and out-of-pocket expenses for patients. 
  2. Increased interest in contracts that demonstrate value. The launch of several gene and cell therapies has been a catalyst to advance the discussion of alternative payment models. 
  3. The declining return on investment for R&D. A Deloitte analysis on the ROI of R&D among 12 large-cap biopharma companies portrays a steep decline over the nine years that the analysis has been performed.
  4. Evolving regulatory frameworks and collaboration between industry and regulators. The U.S. Food and Drug Administration’s (FDA) pre-certification program, which launched in late 2017, is an example of how collaboration between industry and regulators can drive more self-regulation that is rooted in a culture of quality, organizational excellence, and performance monitoring. 

 

Friday
Jan042019

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week: 

As Hospitals Post Sticker Prices Online, Most Patients Will Remain Befuddled 

As of Jan. 1, in the name of transparency, the Trump administration required that all hospitals post their list prices online.

Kaiser Health News

Friday, January 4, 2019

Bristol-Myers to Acquire Celgene in Deal Worth $74 Billion

Bristol-Myers Squibb said on Thursday that it would buy Celgene, a maker of cancer-fighting drugs, in a cash-and-stock deal valued at $74 billion, the first major pharmaceutical deal of 2019.

NY Times

Friday, January 4, 2019

Drug companies greet 2019 with U.S. price hikes

Drugmakers kicked off 2019 with price increases in the United States on more than 250 prescription drugs, including the world’s top-selling medicine, Humira, although the pace of price hikes was slower than last year.

Reuters

Thursday, January 3, 2019 

Ransomware, phishing attacks top new HHS list of cyberthreats in healthcare

Email phishing attacks, ransomware attacks and attacks against connected medical devices are among the greatest cyberthreats that health systems need to protect against, according to new cybersecurity guidance for health systems from the Department of Health and Human Services.

Fierce Healthcare

Wednesday, January 2, 2019

Link between readmission rates, mortality rates back under scrutiny

A new study shows a statistically significant correlation between lower readmission rates and higher mortality rates for patients with heart failure and pneumonia, renewing questions about the efficacy of the Center for Medicare and Medicaid Services' Hospital Readmissions Reduction Program (HRRP).

Fierce Healthcare

Wednesday, January 2, 2019

 

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.

 

Friday
Dec212018

Friday Five: Top 5 healthcare business news items from the MCOL Weekend edition

Every business day, MCOL posts feature stories making news on the business of health care. Here are five we think are particularly important for this week: 

CMS finalizes ACO overhaul, shortening pathway for financial risk

The Centers for Medicare & Medicaid Services (CMS) finalized substantial changes to the Medicare Shared Savings Program (MSSP), an overhaul that will truncate the time that Accountable Care Organizations can remain in one-sided risk models.

FierceHealthcare

Friday, December 21, 2018

Year One Of KHN’s ‘Bill Of The Month’: A Kaleidoscope Of Financial Challenges

In 2018, KHN and NPR launched “Bill of the Month,” a crowdsourced investigation in which we dissect, investigate and explain medical bills you send us. In telling the story behind one patient’s bill each month, our goal is to understand the genesis of the often exorbitant and baffling charges that pervade the American medical system.

Kaiser Health News

Friday, December 21, 2018

Cigna closes $54 billion purchase of Express Scripts

Cigna Corp (CI.N) on Thursday closed its $54-billion deal to buy Express Scripts Holding Co, creating one of the biggest providers of pharmacy benefits and insurance plans in the United States, a combination it says will help it improve healthcare coordination and cut costs.

Reuters

Friday, December 21, 2018

Obama health law sign-ups beat forecast despite headwinds

The Affordable Care Act has yet again beaten predictions of its downfall, as government figures released Wednesday showed unexpectedly solid sign-ups for health coverage next year.

Associated Press

Thursday, December 20, 2018

Most hospitals still use mail or fax to exchange data

Health systems use numerous methods to exchange patient medical records, but providers continue to rely heavily on the old-fashioned approach of mail or fax, according to new federal data on interoperability.

FierceHealthcare

Wednesday, December 19, 2018

These and more weekly news items on the business of healthcare are featured in the MCOL Weekend edition, along with the MCOL Tidbits, and more, for MCOL Premium level members.